Will Units of Affordable Housing affect Neighbouring Property Values?

“I’ve worked hard for many years, and my home is one of my most important investments! Will new units of affordable housing nearby affect the value of my home, or hinder my ability to sell?”

Very broadly, this is what the research says:

Vacant lots, sub-standard housing and abandoned homes are a serious problem that hurts property values. But well-run affordable or supportive housing developments tend to have no impact on the value of local properties. Instead, good looking, functional homes make neighbourhoods more desirable and usually stabilize or increase property values.

There are of course horror stories. In the past, some jurisdictions designed projects that were large, ugly, poorly built and clustered in a way that set them apart from the surrounding community. These projects had the effect of ghettoizing people in poverty and reinforced negative stigmas. As well, not all such housing projects were well-run or well-managed. Some of these projects became difficult neighbours and did impact housing values.

But much has been learned, and contemporary practices emphasize the need for good and responsible design that will blend well into an existing neighbourhood. There is also a push to design projects where units of affordable housing are built alongside regular market rental units (Mixed Market Housing).

EDMONTON, ALTA: ¬SEPTEMBER 30, 2015 –Les Young (l) and Annabelle Wallace , the minister at the Westmount Presbyterian Church. The church is donating its site for a new, smaller building and 16 units of non-profit housing for large families that will have approximately net zero carbon emissions in Edmonton, September 30, 2015. (Photo by Bruce Edwards / Edmonton Journal)

To learn more, please look at some of the following studies. At the top of the list is a study done here in Edmonton.

RESEARCH STUDIES: Examining the Relationship between Affordable Housing and Property Values:

Centre for Local, State, and Urban Policy (CLOSUP). (2009). Has Competition Led to Healthier Neighborhood Effects? A study of Low-Income Housing Tax Credit Projects Built by Three Sector. Working Paper Series No.19, 48109- 2069. Ann Arbor, MI, Gerard R. Ford School of Public Policy, University of Michigan: Deng, L

Galster, G. (2002). A Review of Existing Research on the Effects of Federally Assisted Housing Programs on Neighboring Residential Property Values. Report to the National Association of Realtors, September.

Maxfield Research Inc. (2014). An Update Analysis of the Relationship between Affordable Family Rental Housing and Home Values in the Twin Cities, Prepared for Family Housing Fund Minneapolis, Minnesota. Minneapolis, Minnesota: Maxfield Research Inc.